Independents fear for future as Barnes & Noble expands

Barnes & Noble has changed the face of academic book selling, with mixed results for smaller stores. From sea to shining sea, and in 28 percent of the college towns sprinkled in between, America's bastions of higher learning are sporting a decidedly corporate aspect in what was once the least likely of places -- the bookstore. Penn's bookstore is one of 350 operated by the industry leader, Barnes & Noble College Bookstores Inc. The bookstore will double its size to 50,000-square-feet when it moves to a new location in Sansom Common, on the 3600 block of Walnut Street, in July. The impending presence of a University superstore has caused many to question the future of independent area bookstores. The stories of two other college towns where Barnes & Noble has recently taken control of the university bookstore -- State College, Pa., and New Haven, Conn. -- helps shed light on the impact the entrance of a national chain can have on local independents, for better and for worse. Penn's campus is served by two independent booksellers: House of Our Own on the 3900 block of Spruce Street and the Pennsylvania Book Center on the 3700 block of Walnut. Like Penn, the two cities, home to Penn State and Yale University, respectively, both have several independent bookstores serving primarily local clientele. The neighborhood superstore Harry Berliner has owned the Foundry, an independent New Haven bookstore, for the past 24 years. But none have been as turbulent as the last two, dating to the 1996 entrance of Barnes & Noble onto the local scene. Since the beginning of 1998, sales at the Foundry, one of seven bookstores serving Yale's campus, are down 10 percent. Berliner said B&N;, which took control of the Yale Bookstore two years ago, has had a definite impact on "booklife" in New Haven. "I think that any time you have a national chain, it takes away from the diversity of the marketplace," Berliner said. "They have no real commitment to the community they serve." Stan Frank, marketing manager at B&N; College, called that perception "totally ridiculous." "We know how to cater to a specific community," Frank said. He added that all purchasing decisions are made at a local level. Another issue cited by Berliner is a common point among independents: bigger superstores are less service-oriented. "It's like the difference between Cheers and the All-Star Sports Cafe in New York where nobody knows who the hell you are," Berliner said. "It's too bad to see it happening in the book business." Harry Schwab, who owns Book Haven and competes with the nearby Yale Bookstore, run by B&N;, and the Yale Co-op for the student textbook market, agrees. "When you're small, you get to know your customers," Schwab stressed. But Frank strongly disagreed, noting that service is the No. 1 priority for B&N; stores. He added that employees are hired based on their familiarity with the types of books they work with. The more the merrier? Chris Evans, owner of New Haven's Elm City Books and a former manager of a book superstore, says people shouldn't be so quick to cast B&N; in the role of the villain. "I've always been a fan of more bookstores in a concentrated area," Evans said. "When Barnes & Noble comes in to town, it makes it a destination, it helps guys like me." Marie Witt, the administrator who oversees Penn's bookstore, said she believes that the Sansom Common superstore will have the same effect. "The more book presence you bring to campus, the more you create an interest in books," Witt said. But Greg Schirm, one of the owners of House of Our Own, is not so sure that University City will become a magnet for bookworms. "I'm skeptical as to whether Barnes & Noble will attract people from out of the area," Schirm said. "There are plenty of Barnes & Noble bookstores in our area." The closest superstore is just over a mile away in Center City. Evans, however, noted that the presence of another large new bookstore in New Haven has meant that there are more used books on the market for Elm City to buy and sell. "If you're all filling a niche, then it helps and [stores] seem to complement each other." But when you're all filling the same niche, things get more complicated. And Penn's two independent bookstores both focus on the new book trade, though House of Our Own carries used books as well. Competition One early casualty of B&N;'s entrance into State College was small, independent Shepherd's Books, which will close this month after six years in the area. The store, one of two independents in the area, stocks about 40,000 titles. The typical B&N; superstore stocks upwards of 100,000 titles. Penn's will carry 130,000. Robert Shepherd, the store's owner, said he is closing because market conditions have made it impossible to turn a profit. That may be too bad for local readers. As one customer at the store noted, "I hate those big stores? you just can't get what you want there." Many smaller booksellers accuse B&N; of not competing fairly in securing its dominance of the retail book-selling trade. In a March 1998 lawsuit filed in federal court in California, the American Booksellers Association alleged "a widespread pattern of illegal business actions" on the part of B&N; and Borders, the two largest chains. The alleged practices primarily involve advantages secured from publishers based on the chain's economic clout. The group says the increasing centralization threatens to raise prices and reduce selection in the long run. Other owners point out that increased competition from stores like B&N; is only likely to increase the level of service, while cutting prices at the same time. "It's good to have competition," said Achilles Nickles, who owns the Penn Book Center. "I think that it makes a better environment for consumers." The books you read The increasingly corporate face of modern bookselling at Penn and elsewhere -- independents account for only 19 percent of the $30.8 billion retail book market, down 40 percent from 1991 -- has left decisions about what books ever make it to consumers in increasingly fewer hands. "These powerful corporate entities can effectively exercise a veto on ideas simply because they may lack commercial appeal," Andy Ross said in an open letter posted on the Web. Ross is the president of Cody's Books in Berkeley, Calif., one of the nation's largest independent booksellers and a model for B&N;'s superstores. One example cited by Ross is the case of Salman Rushdie's Satanic Verses, pulled from the shelves of B&N; and Borders when Iran issued a fatwah -- a religious death sentence -- against the author and the book. Independent booksellers, according to Ross, overwhelmingly kept the book on their shelves. Book-list battles At Penn, University Council's Bookstore Committee stirred controversy last fall when it recommended that instructors be required to post their reading lists on the Web. Currently professors send book lists to the store of their choice. Although the report was non-binding, the campus-wide advisory body voted nearly unanimously to reject the committee's recommendations. Witt said she still believes it is important for the bookstore to offer a full slate of textbooks. "I think that there is an expectation that the University store will be as comprehensive as possible," Witt said. According to Nickles, such a policy could be disastrous for his business because the Book Center would have more trouble absorbing the cost of returns on over-ordered books than a larger store would. Svoboda's, an independent bookseller in State College, has had similar difficulties with Penn State's book list. B&N;, which operates the university bookstore in State College, is contractually obligated to provide Penn State's textbook list to two other large stores in the downtown area, both of which predate the university bookstore. But Svoboda's is not on that list, and a legal challenge by another retailer excluded from the list was eventually rejected by the Pennsylvania Supreme Court. Svoboda's has been left to scramble for mid-semester book orders and other types of fringe business. But B&N; has affected more than the store's textbook trade. "We've had to go much more mainstream," said Svoboda's manager Tony Sanfilippo. "We can't be as academic as we'd like." It is stories like Svoboda's that have many concerned about the impact of chain stores on the type and variety of books available to the public. Nickles says he is aware of B&N;'s reputation for "taking no prisoners." "It's not going to be easy," Nickles said. "We'll be academically oriented. We'll have a selection we'll feel that they might not have."